GENTING SINGAPORE PLC
G13.SI
Genting Singapore - Short length of stay by Chinese visitors cap upside for casinos
- According to Singapore Tourism Board (STB) figures, visitor days from China for Jan-Jun 2016 increased 17.0% YoY despite the 55.2% YoY rise in visitor arrivals.
- In terms of length of stay, 24.0% of the visits were under one day and 37.7% were one day long.
- The increase in visits of these lengths (under one day and one day) accounted for between 9 to 10 ppt out of the 17.0% growth in visitor days.
- We believe the short length of stay as well as STB’s marketing focus on Tier 2 and Tier 3 cities to be key reasons why the robust tourist arrival numbers have failed to translate into greater gambling revenue in the past half-year.
- STB recently revealed that Sightseeing, Entertainment, & Gaming expenditure fell 21% YoY in 1Q16, which follows a 13% decline in 2015, and a 6% increase in 2014.
- While we remain bearish on rolling and non-rolling volumes in 2H16, we expect upside from Genting’s right-sizing exercises as well as its Jeju development.
- Maintain HOLD with fair value of S$0.77.
Deborah Ong
OCBC Investment
|
http://www.ocbcresearch.com/
2016-09-06
OCBC Investment
SGX Stock
Analyst Report
0.77
Up
0.720
